May 16, 2017

Facts Matter: Who pays more under the Affordable Care Act

Pictures of Money / Flickr CC

The issue:

Part of the GOP case for repealing the Affordable Care Act is that it has made insurance more expensive or even unaffordable for many people.

"In some cases, insurance premiums and out-of-pocket expenses have become families' most significant expenses," White House Press Secretary Sean Spicer told reporters last week.

The facts:
  • Millions of people have gained health insurance under the ACA. The previously uninsured are now paying premiums, but also have better access to care, less out-of-pocket costs and protection from crippling medical bills.
  • Millions of the newly insured are now on Medicaid, through the ACA's expansion of the program. These people now have access to care and are paying little to no premium or out-of-pocket costs.
  • But people who bought coverage in the individual market pre-ACA are now paying higher premiums on average, according to the Kaiser Family Foundation's Larry Levitt. This is because people with pre-existing conditions can now get insurance at the same rate as everyone else, which raises premiums for healthier people.
  • Premiums on exchanges increased by about 25 percent from the year before in 2017 and are expected to rise again next year, although not as drastically. That's because some insurers are getting more sick people than they predicted, but they're also not getting the federal help they expected.
  • For some people, deductibles are higher. But plans are required to cover a comprehensive set of benefits under the ACA — many of which weren't covered previously, so people had to pay for them out of pocket.
  • Spending on each person with health coverage is growing less rapidly post-ACA than it did before the law was passed, Matthew Fiedler of the Brookings Institution points out.
Why it matters:

It's true that healthy people are paying more for coverage — but it's also true that sick people are paying less. Health policy always creates winners and losers. There is no such thing as perfect health reform, and someone is always going to pay more or less than they currently do.

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